WASHINGTON–The overall economy remains robust, but the latest data show pending home sales fell to their lowest level since October 2014, according to data from the Pending Home Sales Index released by the National Association of Realtors (NAR).
The index, based on contract signings during a month, fell 4.7% to 104.6 in January from 109.8 in December 2017. On an annual basis, the index declined 3.8%from the same period in 2017, the NAR said.
“There’s little doubt last month’s retreat in contract signings occurred because of woefully low supply levels and the sudden increase in mortgage rates,” said Lawrence Yun, chief economist at NAR, in a statement. “The lower end of the market continues to feel the brunt of these supply and affordability impediments. With the cost of buying a home getting more expensive and not enough inventory, some prospective buyers are either waiting until listings increase come spring or now having to delay their search entirely to save up for a larger down payment.”
The Realtors’ data also show the number of available listings were at an all-time low in January and were 9.5% below the available levels during the same period in 2017.